ECONOMIC VALUE ADDED BONUS PLAN EXECUTIVE OFFICERS SENIOR MANAGERS

A.     To promote the maximization of shareholder value over the long term by providing incentive compensation to key employees of STRATTEC SECURITY CORPORATION (the "Company") in a form which is designed to financially reward participants for an increase in the value of the Company.

B.     To provide competitive levels of compensation that enable the Company to attract and retain employees who can have a positive impact on the economic value of the Company.

C.     To encourage teamwork and cooperation in the achievement of Company goals.

The Compensation Committee of the Company’s Board of Directors (the "Compensation Committee") shall be responsible for the design, administration, and interpretation of the Plan.

A.     " Accrued Bonus " means the bonus, which may be negative or positive, which is calculated in the manner set forth in Section V.A.

B.     '' Actual EVA " means the EVA as calculated for the relevant Plan Year.

C.     " Capital " means the Company's average monthly net operating capital employed for the Plan Year, calculated as follows:

D.     " Capital Charge " means the deemed opportunity cost of employing Capital in the Company's business, determined as follows:

E.     " Company " means STRATTEC SECURITY CORPORATION. The Company's Compensation Committee may act on behalf of the Company with respect to this Plan.

F.     " Cost of Capital " means the weighted average of the cost of equity and the after tax cost of debt for the relevant Plan Year. The Cost of Capital will be determined by the Compensation Committee prior to each Plan Year, consistent with the following methodology:

(a)     Cost of Equity = Risk Free Rate + (Business Risk Index x Average Equity Risk Premium)

(b)     Debt Cost of Capital = Debt Yield x (1 - Tax Rate)

(c)     The weighted average of the Cost of Equity and the Debt Cost of Capital is determined by reference to the expected debt-to-capital ratio

where the Risk Free Rate is the average daily closing yield rate on 10 year U.S. Treasury Bonds for an appropriate period (determined by the Compensation Committee from time to time) preceding the relevant Plan Year, the Business Risk Index is determined by reference to an auto supply industry factor selected by the Compensation Committee, the Average Equity Risk Premium is 6%, the Debt Yield is the weighted average yield of all borrowing included in the Company's permanent capital, and the tax rate is the combination of the relevant corporate Federal and state income tax rates.

The Compensation Committee will review the Cost of Capital annually and make appropriate adjustments only if the calculated Cost of Capital changes by more than 1% from that used during the prior Plan Year.

G.   " Earned Wages " includes:

(1)   For Participants who are employed by the Company, all wages paid in the Plan Year, excluding employment signing bonuses, EVA bonus payments, reimbursement or other expense allowances, imputed income, value of fringe benefits (cash and non-cash), moving reimbursements, welfare benefits and special payments.

(2)    For Participants who are employed by STRATTEC de Mexico S.A. de C.V. and STRATTEC Componentes Automotrices S.A. de C.V., the “Base Salary”. Base Salary includes regular salary, holidays and vacations paid during the Plan Year. Base Salary does not include overtime, profit sharing, Christmas bonuses, vacation premiums, signing bonuses, EVA bonus payments, reimbursements and other expense allowances, imputed income, the value of fringe benefits (cash and non-cash), moving reimbursements and special payments.

H.     " Economic Value Added" or "EVA " means the NOPAT that remains after subtracting the Capital Charge, expressed as follows:

                 EVA may be positive or negative.

I.     Effective Date . February 27, 1995, the date as of which the Plan first applies to the Company.

J.     " EVA Leverage Factor " means the adjustment factor reflecting deviation in the use of capital employed as a percentage of capital employed. For purposes of this Plan, the Company's EVA Leverage Factor is determined to be 5% of the monthly average net operating capital employed during the prior Plan year.

K.     " NOPAT " means cash adjusted net operating profits after taxes for the Plan Year, calculated as follows:

     (+ -)     Other Income & Expense excluding Interest Income or Expenses

     (+ -)     Other Unusual Income or Expense Items (See Section VI. B.)

L.     “ Participant ” means individual who has satisfied the eligibility requirements of the Plan as provided in Section IV.

M.     " Plan Year " means the one-year period coincident with the Company's fiscal year.

N.     " Executive Officers " means those Participants designated as Executive Officers by the Compensation Committee with respect to any Plan Year.

O.     " Senior Managers " means those Participants designated as Senior Managers by the Compensation Committee with respect to any Plan Year.

P.     " Target EVA " means the target level of EVA for the Plan Year, determined as follows:

Expected Improvement will be approved by the Board of Directors annually, based on past practice and consideration for current relevant economic conditions. Regardless of the above defined formula, the Current Plan Year Target EVA cannot be less than the Expected Improvement approved by the Board of Directors.

A.     Eligible Positions . In general, only Executive Officers and Senior Managers selected by the Compensation Committee may be eligible for participation in the Plan. However, actual participation will depend upon the contribution and impact each eligible employee may have on the Company's value to its shareholders, as determined by the Compensation Committee.

B.     Nomination and Approval . Each Plan Year, the Chairman and President will nominate eligible employees to participate in the Plan for the next Plan Year. The Compensation Committee will have the final authority to select Plan participants (the "Participants") among the eligible employees nominated by the Chairman and President. Continued participation in the Plan is contingent on approval of the Compensation Committee.

C.     Employee Performance Requirement . Employees whose performance is rated “Needs Improvement” on their annual performance review will not be eligible for an EVA bonus applicable to the year covered by such performance review. However, if the employee so rated is subject to a performance improvement plan, and successfully meets the requirement of the plan in the time frame prescribed, the employee’s EVA eligibility will be reinstated, and the EVA bonus will be paid with the next regular payroll check following reinstatement.

A.     Calculation of Accrued Bonus . Each Participant's Accrued Bonus will be determined as a function of the Participant's Earned Wages, the Participant's Target Incentive Award (provided in Section V.B., below), Company Performance Factor (provided in Section VI.A.) and the Individual Performance Factor (provided in Section VI.C.) for the Plan Year. Each Participant's Accrued Bonus will be calculated as follows:

B.     Target Incentive Award . The Target Incentive Award will be determined according to the following schedule:

A.     Company Performance Factor Calculation. For any Plan Year, the Company Performance Factor will be calculated as follows:

B.     Adjustments to Company Performance . When Company performance is based on Economic Value Added or other quantifiable financial or accounting measure, it may be necessary to exclude significant, unusual, unbudgeted or noncontrollable gains or losses from actual financial results in order to measure performance properly. The Compensation Committee will decide those items that shall be considered in adjusting actual results. For example, some types of items that may be considered for exclusion are:

(1)     Any gains or losses which will be treated as extraordinary in the Company's financial statements.

(2)    Profits or losses of any entities acquired by the Company during the Plan Year, assuming they were not included in the budget and/or the goal.

(3)     Material gains or losses not in the budget and/or the goal which are of a nonrecurring nature and are not considered to be in the ordinary course of business Some of these would be as follows:

(a)     Gains or losses from the sale or disposal of real estate or property.

(b)     Gains resulting from insurance recoveries when such gains relate to claims filed in prior years.

(c)     Losses resulting from natural catastrophes, when the cause of the catastrophe is beyond the control of the Company and did not result from any failure or negligence on the Company's part.

C.     Individual Performance Factor Calculation . Determination of the I